One of the biggest questions confronting policy makers and market watchers is the health of the consumer. This makes the retail trade data for September next week the key release and after two straight months of decline, most economists are looking for a moderate rebound. The extent of that rebound will be an important guide on household financial well-being.
The ‘real’ retail sales result for the September quarter will be included in the release and it appears that sales volumes went backward in the quarter. This is significant as this figure will feed into the GDP result (released in early December).
The problem for consumer spending is linked to a couple of obvious events – record low wages growth, a jump in costs in other areas of the economy (electricity prices for example) and weak consumer sentiment. Until these dynamic change, retail spending growth is likely to remain under pressure.
